A mixed bag for U.S. equities, May 5-9

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2014-05-14

The Dow Jones Industrial Average ended the week 0.43% higher at 16,583.34, on the back of remarks by U.S. Federal Reserve Chair Janet Yellen that the U.S. economy needs support, and that the central bank would keep monetary policy accommodation. The S&P 500 Index moved into negative territory, shedding 0.14% to close at 1,878.48. The Philadelphia Gold & Silver Index dropped 3.89% to 89.38, and the New York spot gold price ended the week down US$10.50 per oz. at US$1,290.10.

Agrium shares fell US$5.19 to US$91.13 after the company reported $12 million in consolidated net earnings from first-quarter operations, or 8¢ per diluted share, compared with $146 million, or 98¢ per diluted share, in the first quarter of 2013. Agrium said that its traditionally low first-quarter numbers were hindered by the record cold winter in North America. The company also approved a US75¢-per-common-share dividend, and that as part of a strategic review process last year, is selling its turf and ornamental business for $85 million — including working capital — to an affiliate of Koch Fertilizer.

Rare-earth miner Molycorp was the second most actively traded stock, tumbling 35.9%, or US$1.71 to US$3.05, after reporting poor first-quarter results. Molycorp’s net loss widened to US$86 million, or US40¢ per share in this year’s first quarter, from US$38.2 million, or US27¢ per share in the first quarter of 2013. Revenue fell to US$118.5 million from US$145.4 million.

Freeport-McMoRan Copper & Gold slid US77¢ to US$33.91 per share. The company reported that its oil and gas subsidiary is selling its Eagle Ford shale assets for US$3.1 billion to a subsidiary of Encana. A day after the announcement, Freeport reported that it had also entered into a US$1.4-billion definitive purchase and sale agreement to acquire interests in the Lucius and Heidelberg oil-production development projects, and 11 exploration leases in the Deepwater Gulf of Mexico, owned by Apache. Lucius should start production by the second half, and Heidelberg in mid-2016.

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